the current situation of china's organic agriculture and ... · animal husbandry: 3.51 million...
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The Current Situation of China's
Organic Agriculture and Organic
Companies
Fanyi MA
06. 09. 2016
Henan University
Henan Province
Finland
338,000 km2
5.5 million
Henan Province
167,000 km2
100 million people
In 2011, 81.92 km2 for
agriculture, and the productions
of crops are about 60 million
tons.
Henan University
Over 100 years old
33 departments and 24
institutes
50 thousands bachelor
students
10 tousands of master &
PhD students
Organic Foods
Organic Foods
The Differences
Normal
Food
Harmless
agricultual Food
Green
Food
Organic
Food
Pestisides Fertilizer Growth
Hormones
Organic Food No No No
Green Food Limited Limited Limited
Harmless
agricultural
Food
Limited Limited No limited
Normal Food No limited No limited No limited
Differences
Chemicals Environment Certificate Authority
Organic Foods No useNeed to be organic, have least 3
years conversion time
General Administration of
Quality supervision
Green
Foods
AA No useEnvironment need to be met
NY/T391-2000
China Green Food
Development Center,
Ministry of Agriculture of
PRC
A Limited useEnvironment needs to be met
NY/T39-2000
China Green Food
Development Center,
Ministry of Agriculture of
PRC
Harmless
agricultural
product
Controlled in
the regulationMeet the standards
The Center for Agricultual
food Quality and Safety,
Ministry of Agriculture of
PRC
Organic Regulations & Standards
How to tell the authenticity of organic food?
www.food.cnca.cn
Current Situations
The Current Situation
Until 2013, there are 9,900 certifications had been awarded, and
6,000 organic companies were registered. There were 3.6 million
hectare lands were regonized as organic farm, increasing from 2.1
million hectare in 2006. 2.5 million hectare were in the
conversion stage.
10 billion RMB (143 million US dollars) domestic sales, and 464
million US dollars
for export sale
Crop Yields: 254 thousand hectare, 1.34 million tons,
3.21 billion RMB (459 million US dollars) domestic
sales, and 220 million US dollars foreign sales.
Animal Husbandry: 3.51 million of quantity, 90.36
thousand hectares herding area, production of 21
thousand of tons, 210 million RMB domestic sale, and
19.7 million dollars foreign sales.
Yields and Sales of Organic Agricultural
Products
In 2010, the yields of different catagories
In planting, organic foods are mainly crops, vegetables, fruits
and nuts.
For the processed products, organic food are mainly material,
drink, and crops.
Price of Organic Foods
The prices of organic foods are usually 3 times of normal foods.
The Prices of Organic FoodsNormal Foods Green Foods Organic Foods
Carrot ¥ 1.8/kg ¥ 6.0 for a box
(containing 2)
¥ 25.0 for a box
(containing 3)
Aubergine ¥ 5.0/kg ¥ 7.0 for 1 ¥ 25.0 for 1
Rice ¥ 2-3/kg ¥ 8-16/kg ¥ 16-40/kg
Reasons for Price
There are usually least 3 years conversion time for the
fields and long processes for the application;
Most farms are small family run operations that are
not highly profit-driven and seldom receive
government subsidies or support for research;
Organic food takes longer to grow than inorganic as
chemical growth hormones and fertilizers can speed
up the growth rate of inorganic crops;
Organic Produce is usually picked when it is ripe unlike inorganic food, which allows for transportation time and is picked unripe and before it is fully developed;
The majority of organic distribution is done on a small scale so the transportation cost are often higher, pushing consumer prices up;
Organic certification bodies charge their members for annual inspection and use of their certification labels, once again driving prices higher;
The Salary of Chinese People
Then, the average month salary:
Beijing: ¥ 9,200, Shanghai: ¥ 8,900, and Zhengzhou: ¥ 5,000
In Zhengzhou, the rent of a single room is about ¥ 1,500. If you
have a family and the house loan is about 2,000 - 2,500 RMB. If
you have a kid going to the kindergarten, it costs ¥ 1,500/month.
All the spending in hospital needs to be paid by ourselves, and
the jacket is department store is cost least ¥ 1,000.
Therefore, the organic foods are not for everyone, it is more
like luxury thing to purchase in China.
According to Yin et al. (Journal Science of Food Agriculture,
2010) reseaches,
Reasons why customers buy organic foods
Reasons why customers not buy organic foods
Engel's coefficient = food expenditure / total expenditure
Dramatic increase in the population of wealthy class who
consider fewer with price
Target People
High-income population and health-pursued crowds.
Accoding to the research, the most of customers earn the
salary over 3,000 RMB/month;
High education population, especially graduated from
college;
Special consuming groups: pregnant, infant parents, and
elderly people.
Typical Organic Consumers
Six out of ten people would choose organic food if it was easily available and cost no more than conventional food.
Reasons for buying organic food 46% say health is the main reason
40% say it taste better
Reasons for not buying organic food 42% say the costs are too high
15% say they are not seen in shops
10% say there is not enough variety
4% say they don’t buy because it does not taste better
Age 25-34, and shopping mostly at specialty stores
Communication
Convenience
Cost
Sale
Consumer
Pregnant women, parents of infants, high-income and high-
education populations concern the safety;
Most communications are from TV, advertisements, and
websites
Convenience for consulting;
Easy to pay;
Quick delivery;
Group order and discount for large orders;
VIP term: put 1,000 RMB in VIP card will award 200RMB
on the cards.
Biological
Safety
Social
Respects
Self
61.9%
28.6%
46.1%
Government
Government Support
BIOFACH China 2015 Conference on International Organic
Food market and Development
•Ministry of Agriculture
•International Foundation for Organic Agriculture Movements
(IFOAM),
•China Green Food Development Center,
•China Organic Food Certification Center
Cai Lan Zi (Shopping
Baskets Program )
This program was brought up by Ministry of Agriculture since
1988 in order to ease the contrdication on food supply and ensure
that residents have fresh vegetables all the year round.
1994, the large farming markets and the production base were
established. 1995, all the information was ready online. Until
1997, there were 4,000 large farming markets.
2001, harmless agricultural foods was introduced and 2002,
“Triple Green Program” (Green Food, Green Market, and Geen
Transport) was brought up.
After 10 years, the aim of government was to improve the quality
of foods
Since online shopping was more and more popular, this
program starts running online.
www.sdclz.com ---Beijing
www.myclz.com --- Shanghai
www. lygclz.com --- Lianyungang
www.maicaiwa.com --- Chengdu
www.cailanwang.com --- Zhengzhou
They are for each city and local vegetables, fruit, rices, meat
and fishes.
Companies
Duncan Farming
A small business
Pick-up activities
Delivery by order
Home-made organic
food Restaurant
Wooden Cottage for
rent
Playing areas for kids
Qianyi Farm
This company was founded by three young men in Henan Province,
and the most interesting thing is they actually put CCTV besides
each field and record it.
The founder of Wanda Organic
Companies was Jianlin WANG, a
multi-billionnaire, who is the
chairman of Wanda Group, a larget
real estate developer.
Although this organic foods project
they just started 3 years, the
company has been already in the
shape.
Wanda Organic Foods Companies
Problems of Organic Foods
Current Problems
Air
Pollution are quite serious in China. For example, the air
pollution in Beijing, the average PM 2.5 of 2013 is 89.5 μg/m3,
and there are 189 days over the limit (PM 2.5 > 35 μg/m3).
Soil
April, 2014, about 19.4% agricultural fields are polluted in
China. Therefore, the 3 years for conversion time are not
enough.
Water
The running water will be polluted from underground water.
about 30 - 40% organic foods containing pesticides due to the
water.
Conculsion Organic Labels
Current Situations
Price of Organic Foods
The Target Groups & Consumers
Government
Companies
Problems
Developmental Prospect
In 10 Years:
Production of China's organic food grows by 30% -- 50%;
1 - 3% increases on the production area;
Exported proportion of agricultural production area will increase
Share on the inernational organic food market will meet or exceed
5%;
China, as the fourth-largest organic food consumed country, the
organic foods in China I believe have a bright future.
Thank you so much!
Any questions?